A $575 handrail replacement is sold to a homeowner. What contract form should the contractor use?
Correct Answer
A) A written home improvement contract.
California requires a written contract for home improvement projects over $500.
Why This Is the Correct Answer
California requires a written contract for home improvement projects over $500.
Why the Other Options Are Wrong
Option B: Use the material-order amount as the signing payment without applying the statutory contract limit.
Use the material-order amount as the signing payment without applying the statutory contract limit. skips the written authority, scope, price, notice, or release control needed for project contracts.
Option C: No contract if the work is completed the same day.
No contract if the work is completed the same day. skips the written authority, scope, price, notice, or release control needed for project contracts.
Option D: Only a supplier receipt with no scope or signatures.
Only a supplier receipt with no scope or signatures. skips the written authority, scope, price, notice, or release control needed for project contracts.
Memory Technique
Deciding Document shortcut is not a term until paper carries it.
Reference Hint
Study anchor (closed-book): memorize Project contracts from CSLB 2026 Law Book; CSLB Home Improvement Contracts / Business and Professions Code Section 7159; know the rule or calculation trigger without relying on exam-room lookup.
More Law & Business Questions
A Fresno homeowner wants a $725 cabinet repair and trim adjustment. Which contract step best matches CA home improvement requirements?
A project has $6,500 retainage withheld. The owner releases 60 percent of retainage at substantial completion. How much cash is released?
Cash is $52,500 and monthly burn is $17,500. How many months of runway are available?
A supplier offers 1.5 percent early-pay discount on a $22,000 invoice. What is the discount?
A balance sheet lists assets of $310,000 and liabilities of $185,000. What is owner's equity?
A job is estimated to cost $135,000. What price gives a 25 percent gross margin?
A customer invoice of $4,000 has a stated late charge of 1.5 percent. What late charge is added?
A bid has direct labor of $18,000, materials of $12,500, and equipment rental of $3,500. If the contractor adds 20 percent markup on direct cost, what is the bid price?
A contractor wants a 25 percent gross margin on a job with estimated cost of $60,000. What selling price gives that margin?
A completed project sold for $150,000 and had total cost of $126,000. What gross margin percentage did the project earn?